[Grovenet] America's Trillion-Dollar Baby

[David Morelli]

Ron,

I am referring to "the city's budget" as in "The City Of Forest  
Grove", a municipal government.  It is having budget issues.

The general fund is largely funded by property taxes.  The general  
expenses go for police, fire, library, parks and rec, administration,  
planning and other consumer services.  The more residents, the more  
demand for parks, for example.  This puts pressure on the city to  
provide parks and park maintenance, which cost money.  The money  
comes from the general fund.

  I would guess that, your observations on the spending habits of  
commuters is pretty accurate.  So, if a city wishes to be viable they  
will want to reduce labor leakage as one factor in reducing  
purchasing leakage.  Otherwise they become a bedroom community and  
eventually they must be swallowed by the city that has the economic  
base to support public services.  Of course, in that case, they lose  
the ability to direct the quality, quantity, and timing of the  
services.  For an example, look at the infrastructure provided by  
Washington County and where it goes.  East County gets their  
projects, we get to wait.

David

On Feb 9, 2007, at 1:30 PM, Ron D'Eau Claire wrote:

> Do I understand your use of "consumption base" to mean that the city's
> revenues are based on what the residents spend in local businesses?
>
> It's my impression that the bulk of the residents here, even many  
> of those
> who also work here, spend most of their money elsewhere. After all,  
> what is
> there to buy in Forest Grove compared to other nearby towns?
>
> With a large percentage of the residents working elsewhere, what's  
> their
> incentive to dig around here for something they can pick up on  
> their way to
> and from work?
>
> Ron D'Eau Claire
>
>
>
> -----Original Message-----
> From: grovenet-bounces at rdrop.com [mailto:grovenet- 
> bounces at rdrop.com] On
> Behalf Of David Morelli
> Sent: Friday, February 09, 2007 12:59 PM
> To: Forest Grove local interests list
> Subject: Re: [Grovenet] America's Trillion-Dollar Baby
>
>
> No, I am saying that our tax base is shifting from one that was based
> upon an urban mix to one based upon a suburban mix.
>
> Formerly, we had a city with businesses and residences providing a
> tax base with residents and workers representing the consumption
> base.  Now, we are moving to a city with a reduced percentage of tax
> base coming from business and an increase in consumption coming from
> residents.
>
> The mantra that has been around for a long time goes, "residential
> land doesn't support residential services, it needs to be subsidized
> by business land."
>
> In the case of Matshushita and the Pacific graduate programs, they
> grew by leaving Forest Grove which reduced in-town and out-of-town
> employees.  In the case of Pacific, I understand that the city
> financially assisted them in their effort to leave.
>
> David